Newt Gingrich Letter

Food Stamps or Paychecks?

In the 2008 campaign, President Obama gave us all a hint of his socialist leanings when he promised to Joe the Plumber that he would “spread the wealth around.”  Last week, we found out that his policies and those of the Democrats are delivering on that promise…although probably not in the way they expected. 

The use of food stamps hit a record high in May 2010, according to the U.S. Department of Agriculture, with 40.8 million Americans receiving Supplemental Nutritional Assistance Program (SNAP) subsidies for food purchases. This is more than one-eighth of the population. 
Worse, the USDA projects the number of Americans using food stamps will rise to 43.3 million in 2011.

President Obama, Nancy Pelosi and the Democrats are insisting that the economy has turned the corner and things are getting better.  But how can the economy be getting better if the use of food stamps, a key metric in gauging the health of the American economy, is projected to increase over the next year? 

A few weeks ago, in this newsletter, I wrote that the fall campaign should be framed around a choice between job killers and job creators.  Sticking to that theme, another way to phrase that clear choice for voters is between policies that result in more Americans receiving food stamps and policies that result in more Americans receiving paychecks.   

More Food Stamps vs. More Paychecks.  That is the choice facing America this fall.

Going Backwards

Unable to defend their dismal record on jobs or the big government, redistributionist policies that have made this the longest recession since the Great Depression, President Obama, Nancy Pelosi and the Democrats are now trying to scare Americans out of embracing the free market again, arguing that we don’t want to go “backwards.” 

President Obama even likened our economic situation to driving a car, saying “You want to go forward, what do you do?  You put it in ‘D.’ When you go backward, what do you do? You put it in ‘R.’” 

There’s a key problem with the President’s strained analogy: The decision to drive forward or backwards depends on where you are parked.  And right now, the United States appears parked on the edge of a cliff. 

In last week’s newsletter, I highlighted three charts as visual proof of the Obama-Pelosi-Reid economic failure.  Here is another chart that should give us a clue as to what direction to drive the American economy if we want more paychecks instead of more food stamps as our future.

Food Stamp Use and New Jobs: The Gingrich Record vs. the Pelosi Record

The graph below depicts the number of Americans receiving food stamps during my term as Speaker versus Speaker Pelosi’s term thus far.  It also shows the change in unemployment rates during our two terms.

As you can see, Speaker Pelosi and I took office at a time when these two indicators were roughly similar:  Food stamp use was at about the same level (around 26.5 million Americans) and there was only a 1% difference in the employment rate (5.6% in 1995 versus 4.6% in 2007). 

The similarities end there.  While the unemployment rate dropped significantly while I was Speaker to 4.2%, it has exploded under Speaker Pelosi, rising almost five percentage points to 9.5%.  And while the use of food stamps dropped during my term as Speaker by 8 million Americans thanks to record job creation, it has increased under Speaker Pelosi by more than 14 million Americans. 

In addition, when I was Speaker we turned a $107 billion deficit into a $125 billion surplus in four years.  Speaker Pelosi’s total lack of spending restraint has helped turn a $458 billion deficit into a $1.27 trillion deficit.  And from 1995-1999, the stock market increased in value by 140%.  Under Speaker Pelosi, the stock market has decreased in value by 14.6%. 

This clear difference in results is due to the clear difference in economic policies pursued by Congress during our terms.

When I was Speaker, we kept spending increases down to an average of 2.9% a year, including entitlements.  That is the lowest rate of increase since Calvin Coolidge.  Under Speaker Pelosi, the federal budget has increased by an average of 9% a year. 

We also cut capital gains taxes to spur economic growth and investment.  Under Speaker Pelosi, House Democrats have raised taxes as part of the healthcare bill, passed a job-killing energy tax, and want to let the 2003 tax cuts expire.  It is hard to find a better illustration of the difference between the pro-jobs, pro-investment, free market policies of conservatives and the big government, high spending, anti-market policies of the left.  (Check out To Save America: Stopping Obama’s Secular Socialist Machine for a more detailed analysis, including the results of the Kennedy and Reagan tax cuts). 

So the next time President Obama and Speaker Pelosi try to deflect questions on their failure on jobs by intoning that we don’t want to go “backwards” to lowering taxes and controlling spending, maybe someone should point out the track record and ask, “Why not?” 

Your friend,

Newt

P.S. Caria Tomczykowska, president of the Polish Arts and Cultural Foundation sent this kind note to Callista and me about Nine Days that Changed the World, “Your fabulous film was shown yesterday to the parishioners at Nativity Church in San Francisco…After crying and hugging at the end, we all pledged to follow JP2s lead and insure that our heritage and faith will continue for generations to come…Thank you so very much again!” 

Newt’s Quick Links

•    ReAL Chairman Dr. Jim Garlow, one of the original drivers behind the Proposition 8 movement in California, discusses the losses and consequences of the amendment being overturned. Read the piece and watch the special video message here.

•    Dan Varroney and I argue it is time to stop putting the screws to small business. Click here.

•    The Americano asks, are Gen. Patraeus and President Obama on the same page?  Click here.

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